Combining Stated Preference and Revealed Preference Methods for the Valuation of Non-market Goods

Abstract

Abstract In this paper, we introduce the combining stated preference and revealed preference methods which is the state-ofthe- art method for the valuation of non-market goods. Revealed preference methods and stated preference (SP) methods have both been applied by economists in valuing non-market goods; however both methods have inherent weaknesses. In order to exploit the strengths of the various approaches while minimizing their weaknesses, combining the two methods has become an important methodological option. Up to now, a growing number of literatures of studying combing the two types of data have evolved, and researchers developed three types of models to estimate combining revealed preference and stated preference data in academic fields: discrete choice model, continuous choice model and mixed choice model. Combining stated and revealed preference methods have been developed fast especially in the transport study field in which ideas could also be leant for environmental economic studies.